Anticipated Developments at COP28

The 28th Conference of the Parties (COP28), held in Dubai, UAE, commenced on the final day of November 2023. Against the backdrop of the Earth's escalating temperature, pivotal subjects on the agenda include the preservation of oceans. This year's event in Dubai features the COP28 Ocean Pavilion, encompassing various themes addressing the challenges and opportunities confronting the oceans. These themes include Ocean, Carbon & Climate Connections, Ocean Stressors & Warning Signs, Rising Sea, Ocean Resources, Blue Economy & Finance, and Blue Solutions & Innovations.

Maritime Carbon Solutions diligently scrutinizes the conference proceedings, particularly focusing on discussions related to the international shipping industry. Below is a synopsis of the industry's expectations for COP28 and the ratified outcomes thus far.

CEOs from prominent shipping companies collaborated in a joint declaration, advocating for substantial regulatory reforms from the International Maritime Organization (IMO). Emphasizing the imperative shift away from fossil-fuel-powered vessels, they called for clear targets and a regulatory framework facilitating maximum greenhouse gas (GHG) emissions reductions per invested dollar. Unified in their commitment to decarbonization, their statement delineates four regulatory pillars:

  1. Stipulation of an end date for fossil fuel-only vessels, accompanied by a clear timeline for GHG Intensity Standards.
  2. Implementation of a GHG Pricing Mechanism to enhance the competitiveness of green fuels during the transition, accompanied by regulatory incentives for deeper emissions cuts.
  3. Introduction of vessel pooling for GHG compliance, where the collective performance of vessels influences regulatory coherence, guiding investments toward achieving the most substantial GHG reduction.
  4. Adoption of a Well-to-Wake GHG Basis, incorporating a comprehensive regulatory framework considering the entire emissions lifecycle, aligning climate objectives with investment decisions.

It is evident that the future of fossil fuels is a focal point at COP28. Delegates are actively seeking to allocate public funds to attract private investments in clean energy projects, especially in emerging countries. Successful outcomes supporting this blended finance approach could unlock new opportunities for investors interested in funding clean energy deployment. While the spotlight is on scaling up renewable energy capacity through solar and offshore wind developments, discussions in the lobby rooms also revolve around new alternative fuels for shipping and other modes of transportation.

COP28's focus on reaching decarbonization solutions revolves around achieving economies of scale in energy technologies, encompassing green hydrogen, Carbon Capture, Utilization, and Storage (CCUS), sustainable fuels, and long-duration energy storage.

Positioned as the midway milestone between the 2015 Paris Agreement and the 2030 Target Year, the Dubai meeting serves as a platform for leaders in the shipping industry to engage in discussions with government representatives, regulators, and policymakers. The aim is to secure high-level political support necessary for advancing decarbonization activities.

The International Chamber of Shipping's message to COP28 attendees emphasizes the pivotal role of shipping in global decarbonization. Recognizing that the transportation of sustainable fuels by ships is integral to the decarbonization of the shipping industry, they assert that global decarbonization is unattainable without concerted efforts in both sectors.